Illinois Retirement Income Tax 2025
See how Illinois treats Social Security, private pensions, annuities, and IRA distributions for a full-year resident, then run the official-source estimate with your own income.
Social Security
The federally taxed portion of Social Security may be subtracted from Illinois income.
Pension and IRA income
Federally taxed distributions from qualified retirement plans and IRAs may generally be subtracted.
Estimated 2025 state tax
$743Resident return; local taxes and unmodeled credits excluded.
Modeled state taxable income
$15,000Retirement-income subtraction
$65,000The federally taxed portion of Social Security may be subtracted from Illinois income.
Federally taxed distributions from qualified retirement plans and IRAs may generally be subtracted.
Scope: The calculator treats entered pension and IRA amounts as federally taxable distributions from eligible qualified plans. Nonqualified deferred compensation, sick pay, and other ineligible income are not modeled.
Illinois worked example
For a single filer age 68 with $80,000 of federal AGI, including $15,000 of federally taxable Social Security, $30,000 of pension income, $20,000 of IRA distributions, and $15,000 of other state-taxable income:
Retirement subtraction
$65,000
Modeled state taxable income
$15,000
Estimated 2025 state tax
$743
This is an illustration, not a tax return. Local taxes, credits, and unmodeled state adjustments are excluded.
What this model does not include
The calculator treats entered pension and IRA amounts as federally taxable distributions from eligible qualified plans. Nonqualified deferred compensation, sick pay, and other ineligible income are not modeled. Review the official instructions before filing.
Review the full Illinois income tax guide →Illinois retirement income tax FAQs
Does Illinois tax Social Security benefits in 2025?
The federally taxed portion of Social Security may be subtracted from Illinois income.
Does Illinois tax pensions and IRA withdrawals?
Federally taxed distributions from qualified retirement plans and IRAs may generally be subtracted.
What does the Illinois retirement tax example include?
The example uses a single filer age 68 with $80,000 of federal AGI, $15,000 of federally taxable Social Security, $30,000 of private pension income, $20,000 of IRA distributions, and $15,000 of other state-taxable income.
Is this a complete Illinois resident return?
No. The estimate focuses on retirement-income treatment and the state rate schedule. It excludes local income tax and does not reproduce every deduction, credit, addition, subtraction, or special pension rule. The calculator treats entered pension and IRA amounts as federally taxable distributions from eligible qualified plans. Nonqualified deferred compensation, sick pay, and other ineligible income are not modeled.
Sources
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